DEFA14A: ODP Corp. Goes Private in Atlas Holdings Acquisition

ODP Corporation to be acquired by Atlas Holdings, transitioning to a private company to accelerate B2B growth initiatives.

Summary

• The ODP Corporation has agreed to be acquired by an affiliate of Atlas Holdings, a global family of manufacturing and distribution businesses.
• Upon completion, The ODP Corporation will become a privately held company.
• This transition is expected to accelerate ODP's B2B growth initiatives and strengthen its position as a trusted partner to customers.
• Management believes private ownership under Atlas will better position the company to capitalize on momentum and invest in long-term success.
• No significant changes are anticipated to current vendor contracts, and business is expected to continue as usual through the closing of the transaction.
• The transaction is expected to be completed by the end of 2025, subject to customary closing conditions.

Sentiment

Score: 8

Explanation: The announcement is framed very positively by management, emphasizing strategic benefits like accelerated B2B growth, strengthened market position, and long-term investment potential under private ownership. While risks are disclosed as legally required, the overall tone of the primary communication (vendor note) is optimistic.

Positives

• Transition to a private company is expected to accelerate B2B growth initiatives.
• Strengthens ODP's position as a trusted partner to customers.
• Better positioned to capitalize on strong momentum and invest in long-term business success under Atlas ownership.
• No significant changes anticipated to current vendor contracts, ensuring continuity for partners.

Risks

• The completion of the proposed transaction on the anticipated terms and timing is not guaranteed.
• Satisfaction of other conditions to the completion of the proposed transaction, including obtaining required shareholder and regulatory approvals, may not occur.
• The Company's stock price may fluctuate during the pendency of the proposed transaction and may decline if the proposed transaction is not completed.
• Potential litigation relating to the proposed transaction could be instituted against the Company or its directors, managers, or officers.
• Disruptions from the proposed transaction could harm the Company's business, including current plans and operations.
• The ability of the Company to retain and hire key personnel may be impacted.
• Diversion of management's time and attention from ordinary course business operations to completion and integration matters.
• Potential adverse reactions or changes to business relationships resulting from the announcement or completion of the proposed transaction.
• Legislative, regulatory, and economic developments could affect the transaction or the Company's performance.
• Potential business uncertainty, including changes to existing business relationships, during the pendency of the proposed transaction.
• Certain restrictions during the pendency of the proposed transaction may impact the Company's ability to pursue certain business opportunities or strategic transactions.
• Unpredictability and severity of catastrophic events, including acts of terrorism, outbreaks of war or hostilities, or global pandemics.
• The proposed transaction may be more expensive to complete than anticipated, including as a result of unexpected factors or events.
• Unexpected costs, liabilities, or delays associated with the transaction.
• The response of competitors to the transaction.
• The occurrence of any event, change, or other circumstance that could give rise to the termination of the proposed transaction, including in circumstances requiring the Company to pay a termination fee.
• Other risks are set forth in the Company's Annual Report on Form 10-K for the year ended December 28, 2024, and subsequent SEC filings.

Future Outlook

The ODP Corporation anticipates accelerating its B2B growth initiatives and strengthening its market position as a trusted partner under Atlas Holdings' private ownership. The company expects to be better positioned to capitalize on current momentum and invest in long-term success, with the transaction projected to close by the end of 2025. No significant changes to current vendor contracts are expected, and business operations are planned to continue as usual until closing.

Management Comments

• "This is an exciting next chapter for us that we believe is the right path forward for our company."
• "Becoming a private company will help us accelerate our B2B growth initiatives and strengthen our position as a trusted partner to our customers."
• "We believe that, under Atlas ownership, we will be better positioned to capitalize on the strong momentum we've achieved and to invest in the long-term success of the business."
• "Simply put, we expect we'll be able to work even better together."
• "Importantly, we do not anticipate significant changes to our current contracts, and it is business as usual through the closing of the transaction."
• "Our relationship with you remains a top priority."

Industry Context

The move by The ODP Corporation to become a privately held company through acquisition by a private equity firm like Atlas Holdings reflects a broader trend where companies seek to escape the short-term pressures of public markets. This allows for greater flexibility to pursue long-term strategic investments and B2B growth initiatives, which can be particularly relevant in mature or transforming industries where significant capital expenditure and longer investment horizons are required to adapt to evolving market dynamics and competitive landscapes.

Legal Proceedings

• Potential litigation relating to the proposed transaction could be instituted against the Company or its directors, managers, or officers.

Stakeholder Impact

• **Shareholders**: Will receive consideration for their shares as part of the acquisition, but face potential stock price fluctuation and decline if the transaction is not completed.
• **Vendors**: Anticipated to experience no significant changes to current contracts, with business continuing as usual and relationships remaining a top priority.
• **Employees**: The ability to retain and hire key personnel is identified as a risk factor during the transition.
• **Customers**: Expected to benefit from accelerated B2B growth initiatives and a strengthened position as a trusted partner.

Next Steps

• The ODP Corporation will continue to share updates with its vendors as appropriate.
• The transaction is expected to be completed by the end of 2025, subject to customary closing conditions.
• Required shareholder and regulatory approvals must be obtained for the transaction to close.
• The ODP Corporation plans to file one or more proxy statements or other documents with the SEC in connection with the proposed acquisition.

Key Dates

Recommendation

For existing shareholders, a 'hold' recommendation is prudent given the announced acquisition by Atlas Holdings, with an expected completion by the end of 2025. Holding the stock allows shareholders to receive the acquisition consideration, assuming the deal closes as anticipated. Selling now would mean foregoing any potential upside if the current market price is below the acquisition price, or avoiding deal completion risk. Without the specific acquisition price, holding is a reasonable strategy for those expecting the transaction to finalize.

Keywords

Acquisition, Private Equity, Atlas Holdings, ODP Corporation, B2B Growth, Merger, Corporate Governance, Vendor Relations, SEC Filing